Rip-off victims unprotected

ENTREPRENEURS who market "healthy chocolate" and other so-called
superfoods are getting away with making prohibited health claims
because of poor policing and loopholes in the law, according to a
consumer advisor to the therapeutic goods regulator.

Local distributors for companies like the Nevada-based MXI Corp
which markets Xocai "healthy chocolate" can make outlandish health
claims for food by slipping through loopholes between the legal
provisions set up to protect consumers in the Therapeutic Goods Act
and the Food Standards Act, said Sydney dietitian Alan Barclay.

The Xocai operation has 75,000 distributors including 620 in
Australia where further rapid expansion planned by its founders,
Jeanette and Martin Brooks whose past companies have a history of
bankruptcies and serial litigation, the Herald has found.

The operation is now being examined by the state Office of Fair
Trading as a possible pyramid scheme following the Herald's
investigation.

Consumers had no "one-stop shop" where they could go to swiftly
get information on such products' health claims, said Dr Barclay,
who is a consumer representative on the Therapeutic Goods
Administration advertising codes council.

There was a lot of "to-ing and fro-ing" between the therapeutic
goods and food standards authorities and by the time they acted,
the damage had been done. Penalties for breaching these laws were
far too small, he said.

"It is in this vacuum these products can be marketed and snake
oil merchants can get away with itcVery little is spent
protecting the public from cowboys and we need to invest more in
policing them," he said.

The only health claim allowed to be made for a food is about the
benefits of folic acid for pregnant women in preventing their
babies acquiring neural defects. Federal and state food ministers
recently rejected a significantly tougher standard drafted by Food
Standards Australian New Zealand (FSANZ), saying it would cost
industry and consumers too much and would be difficult to enforce.
FSANZ has been asked to draft another new standard.

Australia's laws are much weaker than those in New Zealand,
which names and shames companies that have breached tougher
regulations against making health claims for food, Dr Barclay
said.

"Antioxidants aren't monitored under the current food standards
code whatsoever but there were provisons for those under the draft
which has been rejected." Overseas-based websites are beyond the
reach of our laws, he said.

Dr Barclay's criticisms echo those of Choice magazine, which
late last year tested the antioxidant activity of nine
"superjuices" which are Xocai's competitors and found "it wasn't as
high as their marketing hype had led us to expect."

Consumers would be better off eating an apple, Choice concluded
and said the regulation prohibiting therapeutic claims for foods
was not effectively enforced for these juices.

"While the Food and Drug Administration in America has cracked
down on these superjuice people, we haven't had the same action
here,"Choice spokesman Christopher Zinn said yesterday.

The Xocai health claims raised questions about whether
government bodies are taking responsibility for any adverse effects
down the track, the director of Diabetes Services at St Vincents
Hospital, Lesley Campbell said.

"Drugs are tested to the nth degree c [but] these things
are not tested. They're less regulated because they're food. They
don't have to do anything more than register them. They don't have
to have any proof [for their claims]," she said.

Queensland consumer advocate Loretta Marron said the TGA's
complaints resolution panel could not regulate Xocai's claims about
weight loss but it could tackle any Australian websites which
linked to overseas sites making claims about diabetes, cancer and
obesity.